A financial institution in West Virginia is officially the first bank to go under due to the coronavirus pandemic.
The FDIC has announced that a ‘small bank’ is closing its doors in West Virginia. [MarketWatch] The closure has been directly tied to the economic fallout of the coronavirus pandemic.
The First of Many?
The First State Bank of Barboursville in West Virginia has closed, according to the FDIC. Holding some $152 million in total assets, it also held some $139.5 million deposits. Those deposits will now be acquired by MVB Bank Inc. of Fairmont, W. Va. The closed branches of the First State Bank will be opened as branches of MVB, the FDIC said.
According to some cryptocurrency analysts, this is what was to be expected as part of the economic fallout: bank failures. Luckily, this is only one bank, so the deposits were protected. But what happens when it’s a dozen or so banks or more? As analyst Joseph Young (@iamjosephyoung) writes, “The domino is shaking.”
The domino is shaking pic.twitter.com/HlS5hZxsrR
— Joseph Young (@iamjosephyoung) April 4, 2020
BeInCrypto previously reported that U.S. banks now have 0% reserve requirements. The Federal Reserve has been desperately telling Americans not to take out cash out of fears that banks might run out. The financial body has tried to assure Americans that it has an “infinite amount of cash.”
Financial Sovereignty Is Key
Depositors in U.S. banks have every reason to worry about their money. That’s why financial sovereignty is so important—it gives individuals direct control over their money.
For the cryptocurrency industry, the case for Bitcoin has never been stronger. However, amid a time of financial uncertainty, many Americans are sadly struggling to make ends meet. If the pandemic worsens, the situation at the First State Bank may be just the initial domino to fall before many others as Americans request their money in cash.
The Fed believes itself to have ‘unlimited cash,’ but it remains to be seen whether it can hold up to that promise. For now, the future of traditional banking seems uncertain.
The post FDIC Announces First Coronavirus-Fueled Bank Failure in the United States appeared first on BeInCrypto.